Cut 132,000 Civil Service posts: calculation note

Central fiscal result

-GBP 4.0bn - Net fiscal impact in 2028-29

Low case: -GBP 8.0bn. High case: -GBP 1.5bn. Positive numbers are fiscal costs or borrowing pressure. Negative numbers are Exchequer savings or receipts.

Scenario and baseline

• Model 132,000 Civil Service posts removed by 2028-29.
• Central case assumes 80,000 net FTE reduction by target year.
• Baseline is 516,150 FTE in March 2025.
• Excludes wider public-sector workforce reductions.

Affected population

• Affected population is Civil Service FTE posts, not all public employees.
• Direct exposure is concentrated in DWP, HMRC, MoJ, Home Office and MOD.
• Indirect exposure includes claimants, taxpayers, courts, immigration users and businesses.
• Grade mix is unknown, so average-cost assumptions are broad.

Gross impact

• Central saving: 80,000 FTE x GBP 65,000 gross employment cost = GBP 5.2bn.
• Transition costs and outsourcing reduce net saving by about GBP 1.2bn.
• High-saving case assumes near-full pledge and tight contractor control.
• No productivity gain is scored without service redesign detail.

Fiscal build-up, central case

• Gross staff-cost saving: -GBP 5.2bn
• Redundancy and transition costs: +GBP 0.5bn
• Contractor and IT substitution: +GBP 0.5bn
• Lost compliance or service receipts: +GBP 0.2bn

Central net impact: -GBP 4.0bn in 2028-29.

Behaviour and pass-through

• Low case assumes close to the promised headcount cut and limited backfilling.
• Central case assumes slower attrition and some contractor substitution.
• High-cost case assumes only modest savings after redundancy and backfill costs.
• Economic output falls if administrative bottlenecks delay private activity.
• No broad public-sector multiplier saving is added.

Phasing

• 2026-27: -GBP 0.2bn. Preparation or partial implementation.
• 2027-28: -GBP 1.8bn. Main ramp-up year.
• 2028-29: -GBP 4.0bn. Target-year central estimate.
• 2029-30: -GBP 4.4bn. Continuation at steady-state assumptions.

Main source groups

• con-plan-2026: Conservative live policy page; used to identify current pledge wording.
• civil-service-stats-2025: Cabinet Office Civil Service Statistics; headcount and FTE baseline.
• obr-efo-mar-2026: OBR March 2026 forecast; fiscal and macro baseline.
• smith-2012-pubsector: Public-sector downsizing; informs behavioural and incidence assumptions.
• ramey-2011: Government spending multipliers; informs behavioural and incidence assumptions.